The collateral for this loan was a two-storey building with a basement in Bole District near Atlas Hotel. Previously Nib International Bank (NIB) was about to foreclose another residential house in the Gullele District which was collateralised for a loan of seven million Birr. YBG paid the debt just two days short of the foreclosure of the house on July 17, 2009, after raising money selling some of the equipment the company used.
Jolted by CBE's notice of foreclosure in the state newspaper, Addis Zemen, on Tuesday, January 26, the company once again scurried to raise money to pay off its debt, this time by inviting tenders for the sale of its core drilling rigs, which it had used for soil examination as well as two water well drilling rigs and their compressors as of Wednesday, January 27, 2010.
"I have already paid 20 million of the 23 million Br loan I had. They are foreclosing my house only for the remaining three million Birr," Yosef Tegegne, managing director of the company, told Fortune.
Yosef has completely paid off NIB's loan and is left with CBE's three million Birr and another loan of 700,000 Br from United Bank, he said. "I will pay everything back after selling these equipment," he added.
The company was established 26 years ago. It now has six units under it including Yadot Engineering which supplies and installs electro-mechanical equipment; Yadot Water Hunting which drills and rehabilitates wells and offers related consultancy; Yadot Bonafide Trading; which supplies drilling accessories and pumps; and Yadot Freighters which is involved in the transport of goods to and from the port of Djibouti.
The company has drilled several wells in the South, Amhara, Oromia and Somali regional states.
"The rigs could drill wells more than 500 metres deep," Yosef complained, "but the credit complication with the CBE has made it difficult to undertake projects that were available in Addis Abeba."
CBE extended the credit for a six month grace period, but the rigs it bought with the money were delivered after a year and a half, and then it had to wait another year to start operation to raise the working capital using other means as CBE denied the company another loan, he explained.
CBE's foreclosure notice will open Yadot's collateral for auction on March 1, 2010, but Yosef hopes to be able to settle his debt before then and start work with renewed energy.
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